Don't Mess With Taxes

Photo by Caleb Cook on Unsplash

Back in February in posting about tax relief for Maine residents who endured flooding, I predicted that some Californians would be joining the growing group of storm-struck areas granted more time to file 2023 returns.

That wasn't a bold prediction. I've been weather and tax watching for decades, so I was confident in my tax forecast, which was correct.

But some southern Californians who were hit by the recent historic rains aren't the only ones for whom the IRS has granted tax relief and a new June 17 tax filing and payment deadline. Some western Washington State wildfire victims also get similar relief and the new summer Tax Day.

Growing June deadline list: These individual and business taxpayers in San Diego and Spokane become the eighth in the growing list granted the new mid-June Tax Day due to disasters.

They join those who were ill-treated by Mother Nature in Connecticut, Maine, Michigan, Rhode Island, Tennessee, and West Virginia. 

This unfortunate addition of more disaster areas with a June 17 delayed tax deadline is why the mid-summer date earns this weekend's By the Numbers recognition (for the second time).

My fellow Texans in the Panhandle's wildfire paths might soon make it nine states with a June 17 filing/paying delay, although they might get a bit longer since those fires still aren't totally contained.

But enough disaster digression. Regular readers know the drill. Here are the San Diego and Spokane tax relief details.

San Diego disaster tax relief: Severe storms that produced flooding in California began on Jan. 21. The damages in the southern part of the state prompted Federal Emergency Management Agency (FEMA) on Feb. 19 to declare San Diego county a major disaster area.

The Internal Revenue Service followed with tax relief. If FEMA subsequently adds other California localities to its disaster declaration, the IRS notes that they also will get the same relief.

So what is that tax relief? The affected San Diego taxpayers now have until June 17, 2024, to file various federal individual and business tax returns and make tax payments for filings that were due between Jan. 21 and the new June deadline.

This means, for example, that the June 17, 2024, deadline will now apply to:

• Individual income tax returns and payments normally due on April 15, 2024.
• 2023 contributions to IRAs and health savings accounts for eligible taxpayers.
• 2024 estimated tax payments normally due on April 15, 2024.
• Quarterly payroll and excise tax returns normally due on Jan. 31 and April 30, 2024.
• Calendar-year partnership and S corporation returns normally due on March 15, 2024.
• Calendar-year corporation and fiduciary returns and payments normally due on April 15, 2024.
• Calendar-year tax-exempt organization returns normally due on May 15, 2024.

Also, penalties for failing to make payroll and excise tax deposits due on or after Jan. 21, 2024, and before Feb. 5, 2024, will be abated as long as the deposits were made by Feb. 5, 2024.

Spokane disaster tax relief: Wildfires erupted in western Washington State on Aug. 18, 2023. FEMA declared on Feb. 15 that the flames had produced a major disaster area in Spokane County.

UPDATE, April 4, 2024: Whitman County has joined Spokane County in the FEMA disaster and IRS tax relief declarations.

The usual IRS tax relief followed, and will be extended to any other Washington State localities that FEMA might add later to this disaster area.

Specifically, Spokane County individual and business taxpayers now have until June 17, 2024, to file various tax returns and make tax payments that were due from Aug. 18, 2023, through the new June deadline.

This means, for example, that the June 17, 2024, deadline will now apply to:

• Individual income tax returns and payments normally due on April 15, 2024.
• 2023 contributions to IRAs and health savings accounts for eligible taxpayers.
• 2023 quarterly estimated income tax payments normally due on Sept. 15, 2023, and Jan. 16, 2024, and 2024 estimated tax payments normally due on April 15, 2024.
• Quarterly payroll and excise tax returns normally due on Oct. 31, 2023, and Jan. 31 and April 30, 2024.
• Calendar-year partnership and S corporation returns normally due on March 15, 2024.
• Calendar-year corporation and fiduciary returns and payments normally due on April 15, 2024.
• Calendar-year tax-exempt organization returns normally due on May 15, 2024.

In addition, individuals and businesses that had an extension to file their 2022 returns will also have until June 17, 2024, to file them. However, tax-year 2022 tax payments are not eligible for this relief because they were originally due last spring, before the disaster occurred.

Also, penalties for failing to make payroll and excise tax deposits due on or after Aug. 18, 2023, and before Sept. 5, 2023, will be abated as long as the deposits were made by Sept. 5, 2023.

General rules apply to both disaster areas: The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. These taxpayers do not need to contact the agency to get this relief.

You can check on any tax relief updates at the IRS disaster relief page, which has details on other returns, payments, and tax-related actions qualifying for relief during the postponement periods in all FEMA disaster areas.

All of the taxpayers covered by FEMA/IRS major disaster actions also have the option to claim uninsured disaster losses on their tax returns. They also have the option to choose which tax year in which to make the claim.

You can find more about potential disaster tax deductions in my post Considerations in making a major disaster tax claim.

You also can find more on taxes and major disasters in the following posts.

• Picking up the pieces after a major disaster (after Tennessee info)
• Document your property for tax, insurance claims before storms hit
• IRS and other government resources can help you deal with a natural disaster
• Storm Warnings: Preparing for, recovering from, and helping those affected by natural disasters

And individuals and business owners in any disaster area also should check with their state tax department about any relief available at that level.

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